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Owning

a home

Did you know?

New Zealand home ownership is at its lowest level in 60 years. Only 49.8% of people over 15 own or partly own the home they live in, and that number seems destined to continue falling. In the face of house prices over ten times the annual income of a couple in their 30s, many people are feeling the strain of trying to rustle up a deposit. For many, home ownership is the ultimate dream.

The importance of home ownership

Owning your own home gives you autonomy, freedom, and a valuable asset that can be used to improve you and your family’s lives. Home ownership improves health and education outcomes and, in the words of our prime minister, “provides stability for families, strength for communities, and security in retirement.” Home ownership gives you the control over your future that no other housing situation can.

Five tips to get on the property ladder

Do your homework

Study the sales figures and current valuations in the area that you want to live, then visit auctions of similar homes in that area. You need to know the market value of your intended home – then be prepared to pay 20% more. Look at QV and real estate listings for the most up-to-date information. It’s also best to keep one eye on the market; fluctuations can make or break your budget.

Five tips to get on the property ladder

Hit the council files

For a small fee you can view the original property file for any house, including its specifications and drawings. For a little more, you can access a Land Information Memorandum (LIM) report, which will show you any changes that have been made to the property, any potential local council alterations to it, and any problems, including soil contamination and flooding issues. This is an important step in making sure your potential new home is up to scratch – without even setting a foot inside.

Five tips to get on the property ladder

Find funding

If you’ve been in Kiwisaver for three years or more, you may be eligible for their first-home withdrawal and HomeStart Grant schemes to purchase your first home. With the former, you can withdraw all or part of your savings; with the latter, you can receive up to $10,000 in financial assistance. You may also be eligible for the government’s Welcome Home scheme, which allows you to purchase your first home with only a 10% deposit.

Five tips to get on the property ladder

Worst house, best street

Look for cheap property in a good area for a lifestyle that will only improve with time. A house is easy to renovate with time; you need an environment that inspires confidence for you and your family. An easy way to do this is to purchase a home just outside a top school zoning area; you’re in the same suburb, but you can expect to pay substantially less.

Five tips to get on the property ladder

Auction skills

Brushing up on your skills at auction is the best way to avoid let-down on the day. Visiting other auctions will help you become familiar with the strategies and structure, and give you more confidence when a house you want is on the line. Be prepared to bid quickly and confidently, to knock out other opponents – but don’t forget to slow down as you close in on your limit, to prevent the price from soaring out of your range and make your rivals stop and think. It’s also best to feign nonchalance; many auctioneers will try to exploit your interest in a property to their advantage.

Do your homework

Hit the council files

Find funding

Worst house, best street

Auction skills

The compromise

Finding the perfect home is hard, and it isn’t made easier by soaring house prices in the top school’s zoning areas. But buying your dream home in a suburb outside these zones doesn’t mean foregoing your children’s education. Home buyers are increasingly turning to private schooling for the best of both worlds: a top-tier education in a suburb that doesn’t break the bank. The cost difference between properties in top zoning areas and those outside can help you save a substantial amount of money – allowing you to provide even more for your family with time.

Protecting myself from pollution

3 Facts

$338k

the amount that could be saved by buying just metres outside a top school zone.

$272k

the difference in price between houses within and outside of a top school zone – on either side of the same street.

$500k

the expected extra cost over a 20-year mortgage for people looking to buy within the Auckland Grammar zone.

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Instead of spending your money on zoning areas, which are arbitrary and can change at any time, you can spend it directly on your family’s quality of life and education. While opting for private education can save you money while you live in the home of your dreams, you still need to make sure that education stays secure. Not only will REAL Life Cover provide your family with a safety net after you’re gone, but the Special Events Increase Option will allow you to increase your cover for your children’s secondary education – so that if something were to befall you or your partner, you know their futures would stay bright. Life today can be hard. Providing your family with the best head-start might make all the difference in the world.